Manufacturing a Postal Financial Crisis

Canada Post is a publicly owned crown corporation with a universal service obligation requiring it to provide mail and parcel deliveries at reasonable prices across Canada’s vast geography.

Canada Post’s management has long complained about the corporation’s sorry financial state. In May, Canada Post reported a loss of $1.3 billion for 2024. It then posted its largest loss ever in August, dipping into the red by $407 million in the second quarter of 2025 alone.

Like countries around the world, physical mail volume in Canada has declined steadily for many years. But this secular trend doesn’t explain Canada Post’s recent financial losses. Before 2018, the crown corporation regularly posted operating surpluses, earning a high of $194 million in profit in 2014.

Roughly seven years ago, however, things took an abrupt turn. According to the government of Canada’s dire assessment, Canada Post has accumulated more than $5 billion in losses since 2018, and is now “losing approximately $10 million a day.” Management, the government, and business critics have pushed this financial disaster narrative for years.

The union and the public have legitimate reasons to be skeptical, however. First, Canada Post itself blamed its 2018 losses on a pay equity decision in which the crown corporation was found to have discriminated against many of its female workers. The arbitrated award determined that Canada Post paid its largely male urban workers more than the largely female workers in the rural and suburban bargaining unit.

Losses continued to mount following a series of poor investment decisions and a declining market share in the parcel delivery sector. From the pandemic onward, many of the “losses” reported on Canada Post’s balance sheet were in fact capital investments, and the costs of servicing these debts failing to produce the expected returns.

Consequently, Canada Post’s public service mandate and the requirement that it be “financially self-sufficient” have come increasingly into conflict. As the federal government under new Liberal Party prime minister Mark Carney embarks on a program of austerity and workforce reduction, the crown corporation’s public purpose now also appears to be on the chopping block.

The Opening Round of the Fight

The CUPW has long been one of Canada’s most militant labor organizations, defending secure full-time work and paving the way for paid maternity leave through a historic strike in 1981.

Perhaps no round of negotiations has been as strained as the current one. What started out largely as a battle over wages, working conditions, and the protection of full-time jobs, quickly transformed into an existential fight.

As far back as August 2024, CUPW triggered conciliation by filing “notices of dispute” with the government after making “little progress” on its key proposals and facing employer calls for concessions at the bargaining table. It took another month before Canada Post finally tabled its concession-riddled offer to workers. Among other things, the corporation pushed to vastly expand the share of part-time jobs in the bargaining units — a move it characterized as necessary to meet weekend delivery demands.

The union countered with a full set of proposals designed to protect full-time jobs and decent wages while increasing the financial capacity of Canada Post, most of which the corporation rejected outright. By mid-October, the period of conciliation had ended and the union moved one step closer to walking off the job. Following a mandatory three-week “cooling off” period, postal workers in both the urban and rural units voted by more than 95 percent to begin strike action.

With no further avenues for winning a contract at the table, the union issued a seventy-two-hour strike notice, to which Canada Post responded with a retaliatory lockout notice, effectively guaranteeing a work stoppage.

CUPW then walked snowy picket lines for five weeks. With the union’s leverage at its height ahead of the holiday season, the federal government did what many expected: it forced striking Canada Post employees back to the job. Citing an obscure section of the Canada Labour Code, then–minister of labor Steven MacKinnon instructed the Canada Industrial Relations Board (CIRB) to end the strike, extending the existing collective agreements until May 2025 and forcing the parties into an “industrial inquiry commission” tasked with making recommendations about the future of Canada Post.

Government Repeatedly Does the Bidding of Canada Post Management

Last year’s back-to-work order was only the first in a series of government interventions taken at the behest of Canada Post management. Although the industrial commission convened after the first strike was partly meant to study the impediments to reaching a collective agreement, its final recommendations echoed management’s designs nearly verbatim.

During the hearings held throughout early 2025, CUPW argued for the importance of keeping Canada Post public and safeguarding its future for all Canadians through service extensions based on the union’s “delivering community power” model. In particular, the postal union pushed back on what it considered to be the employer’s stealth privatization plan.

Instead, the commission recommended phasing out daily home delivery, lifting the moratorium on rural post office closures, and expanding part-time work. Exhausted after months of hearings, CUPW opted for an overtime ban instead of a full walkout when it regained the legal right to strike in late May.

Rather than return to the bargaining table, Canada Post’s management convinced the government to bypass the union bargaining team and force CUPW members to directly vote on the corporation’s latest subpar offer. Predictably, in late July workers resoundingly rejected the terms of that deal, sending Canada Post back to the drawing board once again.

With workers having repeatedly demonstrated their resolve to win a good contract, the union presented a revised package of proposals to Canada Post on August 20, only to be met with silence for over a month.

After finally wrangling Canada Post back to the negotiating table, Carney’s Liberals blindsided the union by calling an emergency press conference on September 25 and instructing the crown corporation to begin making sweeping cuts. Management now has forty-five days from the time of the announcement to develop a plan based on the industrial commission’s recommendations. Given the green light to end door-to-door delivery and begin closing rural post offices, Canada Post quickly informed the union that it would be revising its not-yet-tabled latest offer.

Following the government’s provocative announcement, the union had little choice but to call a full-scale walkout to protect the public postal system.

With workers across the country back on picket lines, and the government’s thumb firmly on the scale, the crown corporation predictably presented a proposed settlement that would impose massive job losses and decimate service capacity.

Fighting the Gigified Race to the Bottom

Without question, the union is now in a pitched battle to keep Canada Post a viable crown corporation. But focusing too narrowly on the twists and turns of the negotiations can obscure the broader political economy shaping this fight.

Beyond poor investment decisions, Canada Post is increasingly being squeezed by a gigified delivery sector dependent on the hyperexploitation of workers. The parcel delivery business in Canada is now dominated by low-cost firms that engage workers through subcontracting and other forms of precarious employment. In the face of this unfair competition, Canada Post’s share of the parcel delivery market has cratered.

Many private delivery firms classify their workers as “independent contractors,” paying them by the delivery rather than by the hour and evading regulations governing overtime pay, rest periods, and maximum daily and or weekly hours.

Even where drivers are classified as “employees,” subcontracting employment structures make it extremely difficult to unionize. Amazon’s “delivery service partner” model is but one example.

These employment models allow private delivery firms to compete with Canada Post largely on the basis of low labor costs sustained by denying workers access to benefits and basic protections. Federal and provincial governments across Canada have not only refused to properly regulate gig work but have encouraged its spread. Tellingly, Intelcom — one of Canada’s largest delivery subcontractors for Amazon — is headed by the brother of current Liberal minister of innovation, science and industry, Mélanie Joly.

Unions like CUPW now find themselves on the back foot, struggling to shield their members from the worst consequences of an eroded labor market.

In the immediate term, the rallying cry must be to keep Canada Post public and defend the jobs and working conditions of CUPW members. But unless the labor movement addresses the growth of the gig economy in the long term, similar struggles will play out everywhere union members still retain decent working conditions.